Recent
interest in renewable energy in Africa is driven by, among others, the following
important developments. The first is the recent increase in oil prices which,
recently, peaked to US$ 33.16 per barrel (Economist: Jan, 98 - Dec, 2000) at a
time when Africa’s convertible currency earnings are very low due to poor
world market prices and decreased volumes of its commodity exports.
Consequently, it is estimated that in the year 2000, petroleum imports as
percentage of export earnings has doubled from about 15-20% to 30-40% for a
number of African countries.

The second important development that has increased interest in
renewables in the region is the recurrent crises faced by most power utilities
in the region. For example, in year 2000 alone, Ethiopia Kenya, Malawi, Nigeria
and Tanzania have faced unprecedented power rationing which have adversely
affected their economies. The rapid development of renewables is often mentioned
as an important response option for addressing the power problems faced by the
region.

Two
important global environment initiatives have also stimulated greater interest
in renewables in Africa. The first was the United Nations Conference on
Environment and Development (UNCED) held in Rio de Janeiro, Brazil in 1992. At
this Conference, an ambitious environment and development document entitled
"Agenda 21" was reviewed by one of the largest gathering of Government
Heads of States and, perhaps more importantly, was endorsed by a large number of
multi-nationals companies. Agenda 21 sought to operationalize the concept of
sustainable development. In addition, the Rio Conference provided the venue for
the second important event, the signing of the United Nations Framework
Convention on Climate Change (UNFCCC) by 155 Governments (United Nations, 1992).
The Convention came into force in early 1994 after ratification by 50 States.

Renewables featured in both Agenda
21 and the Climate Change Convention (United Nations, 1992). Because of the
important role of fossil fuels in the build-up of greenhouse gases in the
atmosphere (it is estimated that the energy sector accounts for about half the
global emissions of green-house gases) and concomitant climate change concerns,
renewables are perceived to constitute an important option for mitigating and
abating the emissions of greenhouse gases (Socolow, 1992).

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